What Startups Should Prioritize Over TAM, According to Index Ventures
Index Ventures’ Jahanvi Sardana urges founders to rethink TAM and focus on product-market fit instead. Here's why that matters.
Matilda
What Startups Should Prioritize Over TAM, According to Index Ventures Why Startup Total Addressable Market Isn’t Everything Early-stage founders often feel pressured to define their startup total addressable market (TAM) as part of investor pitches. It's one of the first metrics founders include when mapping their business potential—how big the opportunity is, how much money could be made, and how disruptive their product could become. But according to Jahanvi Sardana, a partner at Index Ventures, the obsession with TAM can sometimes steer entrepreneurs in the wrong direction. Image : Google Redefining the Role of Startup Total Addressable Market Jahanvi Sardana compared TAM to riding a wave—suggesting that TAM can be misleading if the timing or the wave itself is misunderstood. She posed a powerful question: What was the TAM for search before Google? By conventional measures, it was almost nonexistent. The same goes for cloud computing before Amazon Web Services or operating systems before Microsoft. These examples show that some of the most successfu…
